Did Raymond's stock actually plummet 66%? Four essential facts regarding the real estate demerger
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When the stock turned ex-date for the demerger of its real estate company, Raymond Realty, shares of Raymond Ltd. fell 66% on Wednesday, closing at Rs 530 as opposed to Tuesday's close of Rs 1,561.30. Despite appearing dramatic, the steep decline is only a notional price adjustment reflecting the real estate arm's separation and subsequent operation as a separate business, not a sell-off.
In order to establish which qualified stockholders will get one share of Raymond Realty for each share held in Raymond, the demerger record date is Wednesday, May 14. The real estate entity is anticipated to list independently by the September quarter of FY26, following the completion of the demerger on May 1.
A notional price adjustment is triggered by a merger.
The sharp decline in Raymond's share price is a hypothetical adjustment to reflect the demerger of its real estate company rather than the result of selling pressure. The shares of the parent business has been revalued in accordance with Raymond Realty's removal from Raymond Ltd.'s financial statements. Unadjusted prices may still be displayed on some trading platforms, giving the impression that the discount is more drastic than it actually is.
However, the worth of shareholders is not declining. They will now own stock in Raymond Ltd. as well as the recently dissolved Raymond Realty.
The real estate industry debuts with impressive figures
With a net cash surplus of Rs 399 crore, Raymond Realty, which has established a significant footprint in the Mumbai Metropolitan Region (MMR), starts its next phase. With EBITDA of Rs 194 crore and a high margin of 25.3%, it recorded revenue of Rs 766 crore for the March quarter, up 13% year over year.
Strong demand for important projects like The Address by GS 2.0, Invictus, Park Avenue - High Street Retail in Thane, and The Address by GS in Bandra drove its booking value for the quarter, which was Rs 636 crore.
JDA expansion increases MMR focus
Through joint development agreements (JDAs), Raymond Realty is expanding its operations, especially in the MMR. It signed additional JDAs in Wadala and Mahim in Q4, increasing the potential gross development value by Rs 6,800 crore.
"With these additions, our current real estate business has a total potential revenue of nearly Rs 40,000 crore, which includes Rs 14,000 crore from the JDA-led model and Rs 25,000 crore from our Thane land parcel," the company stated.
By Q2 of FY26, Raymond Realty is anticipated to list.
By the September quarter of FY26, Raymond Realty is expected to be listed on the NSE and BSE. Investors will be able to assess and monitor the company independently of Raymond's other activities since it will function as a completely independent entity.
The demerger is a component of Raymond's larger strategic shift. In an effort to create targeted verticals and generate value, the group previously split out and listed its lifestyle business in September 2024.
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